US Congress(NEW YORK) -- ABC News projects that Tammy Baldwin has won the U.S. Senate race in Wisconsin, making history as the first openly gay U.S. senator.

Baldwin's win keeps the Senate seat long held by retiring Sen. Herb Kohl in Democratic hands, and ends a bitter race that pitted two longtime Wisconsin politicians against each other.

Opponent Tommy Thompson, a former Wisconsin governor and Republican presidential contender, was well known in the state and nationally. And Baldwin served three terms in the Wisconsin Assembly before successfully running for Congress.

In her victory speech in Wisconsin, Baldwin acknowledged that she makes history as both Wisconsin's first female senator and the country's first openly gay senator.

"Now, I am well aware that I will have the honor of being Wisconsin's first woman senator. And I am well aware that I will be the first openly gay member," Baldwin said to loud cheers and chants of "Tammy, Tammy!" from her supporters. "But I didn't run to make history. I ran to make a difference."

Few states have become more crucial to the political aspirations of both parties as Wisconsin has been in the past 24 months. Once a reliably Democratic state, Wisconsin has now been a target for Republican political efforts after the GOP made significant gains in the House of Representatives, the governor's mansion and in the state legislature.

Democrats hoped to keep the seat in their party's hands, while Republicans viewed the open race as an opportunity to make a second gain in the Senate in Wisconsin.

A Thompson win would have given Republicans two Senate seats in the state for the first time since the 1950s. Republican Ron Johnson ousted longtime Democrat Russ Feingold in 2010.

Thompson called Baldwin to concede what had been a highly contentious race. And on Tuesday night, Baldwin called for unity.

"Tommy and I didn't always agree — in fact, in this campaign we didn't agree on much. But there can be no doubt that he shares my love and all of our love in Wisconsin," Baldwin said. "Tonight I want to reach out to his supporters and ask them to join me in standing up for our belief that we are all in this together."

In late summer, Wisconsin also went from a likely Democratic state to a presidential hotbed when Mitt Romney selected Wisconsin native Rep. Paul Ryan as his running mate.

The Baldwin-Thompson race was among the most expensive Senate races in the country, according to the non-partisan Campaign Finance Institute. Outside groups poured more than $40.2 million into the state and the two candidates raised $20 million combined.